Harley stock rises 26% since Fed rate hikes began

Harley-Davidson's stock has experienced fluctuations over the past few years, trading at approximately $31 at the end of June 2022, just before the Federal Reserve began increasing interest rates. Since then, the stock has risen by about 26%, currently trading around $38 per share. Despite this increase, it remains about 22% lower than its pre-inflation high of $50 seen in May 2021. The company's performance has been impacted by inflation and high interest rates, which have made financing more expensive for potential buyers. In recent years, Harley's annual returns have varied significantly, with gains of 4% in 2021, 12% in 2022, and a decline of 10% in 2023. Comparatively, the S&P 500 index gained approximately 45% during the same period. The volatility in Harley's stock performance contrasts with the Trefis High Quality Portfolio, which has consistently outperformed the S&P 500. The Fed's recent decision to cut interest rates by 50 basis points marks the first reduction in nearly four years, which could influence Harley's stock trajectory moving forward. The company's Q2 2024 results exceeded expectations, with adjusted net earnings rising by 34% year over year and sales increasing by 12% compared to the previous year. Given the uncertain macroeconomic environment, including potential rate cuts and ongoing global conflicts, analysts are questioning whether Harley will continue to underperform relative to the S&P 500 or experience a significant rebound in the coming months.